Calculation of each partner's share of the net income.
At the end of the first year of operations on 12/31/08, FMR Company's accounts show the following:
|
Partner
|
Drawings
|
Capital
|
Salary Allowance
|
|
Fred
|
$ 15,000
|
$ 36,000
|
8,000
|
|
McFeeley
|
10,000
|
22,000
|
12,000
|
|
Rogers
|
20,000
|
42,000
|
25,000
|
The capital balance represents each partner's initial capital investment. The Net Income for 2008 was $27,000. Each partner is allowed 10% interest on beginning capital balances. Each partner gets a salary allowance. The remainder is shared in the ratio 3:4:3.
Calculate each partner's share of the Net Income. Show your calculations.